World Markets in Motion

US Industry Overview

Wednesday, May 9, 2007

I was forced to cover and subsequently went long today, after WFR broke resistance at $60.00. The stock moved higher breaking the gap originally set at on 04/27/2007. The estimated target is $67.00.

I was hammered during this trade because I acted before conformation was given. The stock formed a double top at $59.78 and $59.90 on May 4th and 8th respectively. Although this formation marks resistance and indicates the possibility of a bearish reversal, conformation is needed. In this case the stock rallied, broke resistance and burned me.